As the economy strengthens, small business owners are feeling better than they have in eight years.
Optimism among entrepreneurs has risen to pre-recession levels, according to a National Federation of Independent Business report released Tuesday, reversing the slide from the dark days of the financial crisis.
The group’s index for tracking optimism, based on a survey of its members, was at 100.4 in December, up 2.3 points from the previous month. It is the highest reading since October 2006.
“This could be a breakout for small business,”Bill Dunkelberg, NFIB’s chief economist, said in a statement. “There’s no question that small business owners are feeling better about the economy. If they continue to feel that way 2015 could be a very good year.”
Coins2Day spoke with Holly Wade, NFIB’s director of research and policy analysis, to gauge what five things entrepreneurs can look forward to in 2015.
1. Sales are at a high
Any business owner will tell you that life is good when sales are high. And that’s a sentiment highlighted in latest research from the NFIB, a trade group that represents small businesses. Wade said that the last quarter saw higher sales, helped by rising consumer confidence.
“That’s by far the best sign for a business owner,” she said.
She said that consumer spending is reaching levels unseen since the recession, which can only mean good things for entrepreneurs.
“Sales prospects are looking up,” the report said.
2. Energy costs are low
Falling crude oil and gasoline prices give small business owners something to big to cheer about, Wade said.
“Lower fuel costs are certainly helpful to small business owners and provides them with a big cost break,” she said. “How temporary that is I don’t know, but in the current environment that’s really helpful.”
3. Wages appear higher, but so are healthcare costs
Wages and healthcare costs are a little trickier to unpack, according to Wade. But, basically, Reuters reported Tuesday that wages are going up. While Wade said that employee pay is increasing, a lot of that can be attributed to more money being spent on healthcare benefits. It’s a detail that can be missed by the media, she said.
“That’s certainly good for wages and employees,” Wade added. “Whether it’s health insurance or wages, we’re not quite sure.”
4. With more Republicans in Congress, small business owners seem happy
In October and November, Wade said that the NFIB saw a substantial increase in general business outlook among entrepreneurs. “That was obviously right during the election,” she pointed out. “Owners were certainly optimistic about the results and how that might impact their business and the environment in which they run their business in the future.”
5. With the economy looking up, small businesses can scale up
Wade said that the stronger economy makes it a better environment for borrowing. What’s that mean for small business owners? Time to take out loans and grow. “We haven’t seen, so far, any red flags or problems in that area,” she said. “As we see it now, it seems to be a good environment for the small business economy for them purchase and expand.”
For more, Coins2Day also spoke with the Small Business Association about 2015 New Year’s resolution for entrepreneurs.